How can firms prove their ‘good culture’ to regulators, when the standard of proof that regulators expect is rapidly moving ahead?  The first official global survey (IOSCO FR05/2019) of how financial Conduct regulators are now using “Culture measurement” to question customer outcomes was published on the 10 April 2019.  More than 25 financial enforcers around the world – including of course our own FCA – are now using behavioural science to test how well financial firms treat customers.  Regulators broadly agree: their new, behavioural approach is delivering sharper analytical tools that better identify real levels of customer care.  

As never before, regulators now use these tools to question how far customer outcomes are “acceptable and expected” across a wide range of products, markets and jurisdictions.  Regulators’ new tools include top-down Culture Audits; talking directly to front-line staff about their experiences; and Fairness Analysis of specific products.  In the UK, 2019 sees Conduct rules (including SMCR) extending beyond banks to include insurers, asset managers and other providers. Any firms that persist in using a conventional Compliance approach will soon find their culture exposed to critical public scrutiny.

We have created a UK Finance interactive workshop that responds to member firms’ concerns that “The MI we have isn’t the MI we need for Culture reporting”.  This continues the premise of our original, popular series of Conduct workshops: that it’s better to learn in advance what is expected of your firm, rather than wait and find your front-office staff lost for words in the face of an unexpected Culture question from an FCA case officer.  

Senior lead managers for culture assessment have been asking whether their own approaches are valid and worthwhile, and whether the regulator is likely to approve them when first examined.  To find out what a culture audit means for your firm in practice, you first need to know which elements of behavioural science regulators care about, then how they use them: What culture factors and indicators will you be expected to report?  Where your existing MI falls short, where else do you look for it and how do you frame better audit questions of your own? How vulnerable is your firm, compared with other providers?

Join us on this interactive workshop for first sight of a range of firms’ Culture reporting designs; straight answers to common questions from culture project team leaders; an industry-wide informed view of which MI sources are most valuable, and which indicators most effective; and an update on the latest research sources that inform regulators’ thinking.

Outcomes

By attending this session you will:

• Understand the FCA’s view of what constitutes acceptable and unacceptable cultures, in the Boardroom, in business lines, product design and compliance functions;
• See practical examples of indicators used to measure and incentivise a culture of good conduct and compliance; MI that answers the question of “what good behaviour looks like”;
• Identify significant patterns of behaviour, both exemplary and prohibited;
• Be better equipped to assemble a cultural measurement tool and to appraise the value of culture and compliance initiatives.

Take this training in-house

If you have five or more delegates who wish to attend this briefing, it may be more cost effective to run it in-company. To find out more about in-company training, please contact the team on 0203 934 1014 or training@ukfinance.org.uk